New York:Major U.S. airlines are facing financial challenges as rising fuel costs significantly affect their third-quarter profits, despite experiencing strong travel demand and record-breaking revenues.

According to Agence Kampuchea Presse, American Airlines reported a net loss of $269 million in Q3, even though it generated record revenues of $16.3 billion. The airline's fuel expenses surged by $1.9 billion, a 67.5% increase, with an average fuel cost of $3.85 per gallon. Additionally, American Airlines anticipates paying $4.7 per gallon in the fourth quarter, almost double the previous year’s price, with expected quarterly fuel expenses rising by approximately $2.8 billion year over year.

American Airlines has revised its full-year outlook, now projecting an adjusted loss of $1 to $1.6 per share, compared to its earlier estimate of a loss of 65 cents to a profit of 65 cents per share.

Southwest Airlines also faced similar issues despite exceeding Wall Street expectations for Q3 earnings. The Dallas-based airline reported a net income of $270 million and a 21.2% increase in operating revenues, reaching a record $8.4 billion for the third quarter. However, fuel costs for Southwest Airlines rose by $821 million compared to the same period last year, with a Q3 fuel cost of $3.92 per gallon, exceeding their prior assumptions.

Southwest Airlines CEO Bob Jordan expressed confidence in the company’s earnings potential, stating, "Demand remained strong as we lapped last year's bag fee and other commercial initiatives, reinforcing our belief that the earnings power we've built is durable, even with significantly higher fuel costs." The airline estimates a fourth-quarter 2026 fuel cost of approximately $4.55 per gallon.

United Airlines reported Q3 revenue of $17.9 billion, marking a 17.4% year-on-year increase, with net income at $1 billion. Despite this, the airline's fuel expenses grew by $1.8 billion, or 62%, compared to the previous year. United Airlines expects to pay about $4.8 per gallon for fuel in the fourth quarter, up from $3.9 in Q3. The airline forecasts adjusted earnings of 50 cents to $1.5 per share for the fourth quarter, which falls short of Wall Street expectations.